1. Separation of School and State What I Learned at AP Economics Teacher-Training Pikes Peak Economics Club Colorado Springs, CO July 15, 2009 Paul T. Prentice, Ph.D. pprentice@farmsector.com

2. Economics Training is Critical to Maintaining a Free Society  For too long, the study of economics has been ignored in the U.S. educational system.  It is no longer required in most high schools, nor for most college degrees.  Economic ignorance is at the root of many of America’s problems.

3. Economic Ignorance National Council on Economic Education  “Why Johnny Can’t Choose: Economic Illiteracy in America” (2005): http://www.bsu.edu/mcobwin/majb/?p=154 http://www.bsu.edu/mcobwin/majb/?p=154  “The American economy is the eighth wonder of the world; the ninth wonder is the economic ignorance of American people.” - Arthur Levitt, Former Chairman, AMEX  An “Economic Literacy” survey by the Federal Reserve Bank of Minneapolis showed that only 44% of the public has taken a course in economics: http://www.minneapolisfed.org/publications_pap ers/pub_display.cfm?id=3579 http://www.minneapolisfed.org/publications_pap ers/pub_display.cfm?id=3579 http://www.minneapolisfed.org/publications_pap ers/pub_display.cfm?id=3579  High School students’ average score on the Economics Quiz is 53% (“F” grade).  60% of high school students get an “F”.

5. Animated Cartoon Produced by Harding College (late 1950’s) “Make Mine Freedom”  “To create a deeper understanding of what has made America the finest place in the world to live.”  http://www.youtube.com/watch_pop up?v=WB6p5QPVhPI http://www.youtube.com/watch_pop up?v=WB6p5QPVhPI http://www.youtube.com/watch_pop up?v=WB6p5QPVhPI

6. Some Hope (2009 cartoon)

7. New Push for AP Economics Education in High Schools  Parents like AP because students get “free” college credit.  AP courses bump up GPA’s for entrance into college.  Administrators like AP because they are judged on the # of courses, and the # of students enrolled.  BUT: They are not judged on the # of students who actually pass!

8. So, more economics teaching Is a good thing, right?  Wrong. “There are two kinds of economists. There are good economists and bad economists. Good economists know that there is no such thing as a free lunch.” - Walter Williams  In order to pass the National AP Macroeconomics exam, students must be taught that there is a free lunch, and that is is provided by government.

9. In order to pass the AP test, high school students must prove:  Printing more paper money creates more real income and wealth (“monetary policy”).  Inflation is caused by too many people working (the “Philips Curve” tradeoff between inflation and unemployment).  Taking money from the private sector and giving it to the government sector creates more real income and wealth (the “balanced budget multiplier” of fiscal policy).  A weak dollar relative to foreign currencies creates more real income and wealth.  The economy is inherently unstable, and can only be stabilized by government policy.

10. When I asked about competing economic theories and different schools of thought, I was told:  It doesn’t matter. Even if their logic is correct, the Keynesian answer is the only correct answer.  If your students want to pass the exam, they have to give the Keynesian answer.

11. The AP College Board  Controls the economic “standards” that have to be taught in order for students to pass.  It consists of college professors, high school teachers, government education bureaucrats, and textbook publishers.

12. AP Economics Textbooks  For many years market-oriented and supply-side economics dominated the real world. The AP textbook of choice was N. Gregory Mankiw’s “Principles of Economics”.  Now that markets are out of fashion, the AP textbook of choice is Paul Krugman’s “Economics” (2009)

13. Paul Krugman Princeton University Nobel Economist (2008)  Op-ed columnist and economics blogger for the New York Times. “The Conscience of a Liberal” http://krugman.blogs.nytimes.com/ http://krugman.blogs.nytimes.com/  Deficits saved the world (July 15, 2009): “Government deficits … are the only thing that have saved us from a second great depression.”  A trillion dollar bargain (July 14, 2009): Socialized medicine will result in lower health care costs.  Betraying the Planet (June 28, 2009): Global warning deniers are committing “treason against the planet”.

14. “ The current stimulus is too low and too slow. We need a second stimulus.”  The top Keynesian economists are near unanimous in their belief that there must be a second stimulus. http://abcnews.go.com/ThisWeek/Po litics/story?id=7966402&page=1 http://abcnews.go.com/ThisWeek/Po litics/story?id=7966402&page=1 http://abcnews.go.com/ThisWeek/Po litics/story?id=7966402&page=1

15. The “best and brightest” high school students are being taught this.  "The education of all children, from the moment that they can get along without a mother's care, shall be in state institutions at state expense." - Karl Marx, The Communist Manifesto  "Give me four years to teach the children and the seed I have sown will never be uprooted." - Vladimir Lenin  "Education is a weapon, whose effect depends on who holds it in his hands and at whom it is aimed." - Josef Stalin  "It is the State which educates its citizens in civic virtue, gives them a consciousness of their mission, and welds them into unity." - Benito Mussolini

16. Separation of School and State  " 'Parent choice' proceeds from the belief that the purpose of education is to provide individual students with an education. In fact, educating the individual is but a means to the true end of education, which is to create a viable social order to which individuals contribute and by which they are sustained. 'Family choice' is, therefore, basically selfish and anti-social in that it focuses on the 'wants' of a single family rather than the 'needs' of society." -- Association of California School Administrators